Cameroon - Livestock Sector Development Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 7370-CM I~~~~~~~~~ REPUBLIC OF CAMEROON LIVESTOCK SECTOR DEVELOPMENT PROJECT STAFF APPRAISAL REPORT November 15, 1988 Agriculture Operations Occidental and Central African Department Tmis document has a resticted distrbuon and may be used by redpiens only in the perfomanMe of  CURRENCY ELqtVALWNTS Currency Unit - CFAP Franc CFAF) US$l - CFA? 290 a) WEIGHTS AND MEASURES Metric System ABBREVIATIONS AND ACRONYMS BDPA Bureau pour le developpement de la production agricole DPA Direction de la production animale DEPF Direction des etudes, des projets et de la formation (MINEPTA) ECU European Currency Unit EDF European Development Fund EEC European Economic Community FAC Fonds d'aide et de cooperation (France) FONADEF Fonds national de developpment rural IFAD International Fund for Agricultural Development IRZ Institut de recherches zootechniques LDF Livestock Development Fund LLDP Letter of Livestock Development Policy MINEPIA Ministbre de l'elevage, de la peche et des industries animales ONDAPS Office national de developpment agricole et du petit betail OPV Office pharmaceutique veterinaire PLD Provincial Livestock Delegation PLMA Pilot Land Management Area PPF Project Preparation Facility PPR Peste des petits ruminants SODEPA Societe de developpment et d'exploitation des productions animales TLU Tropical Livestock Unit UNDP United Natioias Development Program. USAID United States Agency for International Development FISCAL YvAR July 1 - June 30 a/ Exchange rate at end September 1988. The exchange rate of the CFA Franc is fixed at 50:1 with the French Franc, which is a floating currency.  FOR OMCAL USE ONLY CAMEROON LIVESTOCK SECTOR DEVELOPMENT PROJECI STAFF APPRAISAL REPORT TABLE OF CONTENTS PaRe DOCUMENTS CONTAINED IN THE PROJECT FILE ......................... i LOAN AND PROJECT SUMMARY ........... ... . iii INTRODUCTION ... 6...................................... ................. 1 I. THE NATIONAL ECONOMY ....... ............................... 1 General ................................................. 1 The Role of the Agricultural Sector ..................... 2 It. THE LIVESTOCK SECTOR .......................... ... .... . 2 Livestock in the Economy ....... .............................. . 2 Livestock Production and Constraints ...... ....... 3 Livestock Institutions .. ... ....... ..*. . . . ................. 5 Government Livestock Devtilopment Strategy ............... 8 The Bank's Role and Xxperience with Livestock Dev.J.opment in Cameroon ............................... 9 III. THE PROJECT .... ........................................... 10 A. Objectives ...0.................................... 1 B. Project Strategy .................................... 10 C. Suvmary Project Description ......................... 11 D. Project Area ........................................ 12 E. Rationale for Bank and IFAD Involvement .......... ... 12 F. Detailed Project Description ....... . . 13 (a) Policy Reforms .................. .... . 13 (b) Project Investments ................ * ...... 16 Institution Building ........ .................. 16 Resource Management ........................... 18 Animal Health ... 19 Subloans for Livestock Production/Services ... 20 This report is based on the fJndings of preappraisal and appraisal missions undertaken respectively in November 1987 and March 1988 by a team consisting of Messrs. C. de Haan (Mission leader and Senior Livestock Specialist), M. Asseo (Senior Economist), Ms. B. Hanan (Financial Analyst) and Mr. A. Sousbie (Financial Analyst, Consultant in charge of reviewing the parastatal sector). To ensure maximum Cameroonian participation in the project's design, a workshop with Cameroonian officials was organized during the appraisal mission. An IFAD post-appraisal mission was carried out in May/June 1988 by IFAD consultants (Messrs. R. Harris, Mission Leader and Economist, and J. Boutrais, Sociologist). T ', e -- - t - ; F- d' r' *t 1, . - MA - v ra. *s w , Iv ' ti '' ' l  Pase IV. PROJECT InPLEMENTATION ..... .............................. 20 Project Organization and Management .................... 20 Onlending Channls for Subloans ............. ............ 21 Projec? Preparation Facility (PPF) ............ 22 Annual Work Programs and Budgets . ....................... 22 V. PROJECT COSTS AND FINANCING ........ ............ 22 Cost Estimates ..... . ..... . .. 22 Financing .............. .......... 23 Onlending Procedures .................. ........ ... 24 Procurement ..... 24 Disbursements ..... ...26 Accounts and Audits .......... ....... . .... 27 Project Impact on MINEPIA's Budget ................. 27 VI. PROJECT JUSTIFICATION AND RISKS ...... .................... 28 Incremental Production ....... #......................... 28 Financial and Economic Benefits ..... ................... 29 Equity Considerations ..* ....................... ........ 29 Project Risks ............. .............................. 30 Environmental Considerations ...... ..................... 31 VII. ASSURANCES OBTAINED, CONDITIONS AND RECOMMENDATION ........ 31 1 Livestock Production and Consumption 2 Major Technical Constraints and Options for Livestock Development 3 Socio-Economic As#ects of Livestock Raising 4 NINEPIA's Organization Chart 5 Veterinary Pharmaceutical Office (OPV) 6 Govermdent's Letter on Livestock Development Policy Attachments Action Plar for Institutional and Administrative Reforms 7 Experience with Pastoral Associations 8 Institution Building Component 9 Resources Management Component 10 Animal Health Component 11 Project Monitoring 12 Detailed Cost Tables 13 Estimated Schedule of Loan Disbursement 14 Government Cash Flow 15 Benefit Stream 16 Evolution of Margins and Charges of OPV 17 Budget of a Veterinary Agent 18 Economic Benefits MAPs IBRD No. 20985  CANEROgE LIVESTOCK SECTOR DEVELOPMIENT PROJECT STAFF APPRAISAL REPORT DOCUMENTS CO'nTAINED IN THE PROJECT FILE 1. Pellemon International (1986): Programme de Recensement de l'Elevage. Z. MINEPIA Annual Report 1986. 3. BDPA (1987): Lutte contre les Glossines, Bilan et Perspectives. 4. BDPA (1987): Etude sur les Investissements de la Soci4t4 de Developpement et d'Exploitation des Productions Animales. 5. University of Saarbrucken (1987): Ecological Side Effects of Dieldrin, Endosulfan, Deltamethrin and Cypermethrin Application Against Tsetse Flies in Adamaoua, Cameroon. 6. BDPA (1987): Etude Socio-Economique sur l'Elevage au Cameroun. 7. SEDA (1987): Etude sur lea Credits aux Eleveurs. 8. Boutrais/BDPA t1987): Etudes sur les Problemes chez les Eleveurs. Ar. 9. Consortium BDPAISEDA/JVL (1987): Rapport ,Oe Preparation d'un Troisieme Projet de l'Elevage. 10. MINEPIA (1988)s Donn#es sur lea Importations de Viandes Congeldes en Republique du Cameroon. 11. Sousbie (1988)s Report on SODEPA. 12. Sousbie (1988): Report OPV and Terms of Reference for its Reorganization. 13. Detailed Cost Calculations. 14. IFAD. Post Appraisal Report, Messrs. Harris and Boutrais.  CAMEROON LIVESTOCK SECTOR DEVELOPMENT PROJECT LOAN AN' PROJECT SUMMARY Borrowers Republic of Cameroon Beneficiary: Ministry of Livestock, Fisheries and Animal Industries (MINEPIA) Loan Amounts US$34.6 million equivalent Teras: Standard IBRD terms, with a five-year grace period and 17 years maturity. Onlending Terms: Up to US$8.9 million would be entrusted to one or several financial intermediaries against a management fee of IZ to 32 plus a margin on repayments and on- lent to private sector agents, herder associations and semi-intensive poultry breeders, at an annual rate of not less than 112. CofinancinPA: International Fund for Agricultural Development (IFAD) European Development Fund (EDF) Aid and Cooperation Fund of France (FAC) Proiect Description: The project would aim to increase meat and milk production, raise producers income in particular of poor livestock herders, and reduce the Government's financial burden for its services to the livestock sector. The project would accomplish this in a sustainable fashion by combining policy reforms and investments tot (a) improve the efficiency of the traditional and emerging modern livestock production sector; (b) promote the role of the private sector in the provision of services to producers; (c) make parastatal enterprises profitable and competitive; and (d) strengthen the planning and extension capabilities of the Livestock Services of MINEPIA.  - iv - The Policy refo=ms would cover (a) the privatization of clinical veterinary services and a greater private sector involvemen'; in the distribution of veterinary drugs; (b) full cost recovery for all clinical services anti drug distribution; (c) the reorganization of the Vete rinarf Pharmaceatical Office (OPV); (d) the transformation of SODEPA's commercial activities into autonomous, self-financing operations; (e) the harmonization of the extension methods of MINEPIA's field services with those of the Ministry of Agriculture; (f) the stabilization of MINEPIA stAff at their present numbers and improvement of their training; and (g) the monitoring of impact of meat import taxation on production and consumption. Proiect investments would comprise (a) an institution building component to crep4e and strengthen producer associations, improve livestock extension services, and strengthen MINEPIA's central services; (b) a resource management component to allocate grazing rights to herder associations in 11 pilot land management areas (PLMAs), provide the PLHAs with infrastructure, develop range land research and monitoring, and establish a protection system for areas cleared of the tsetse fly; (c) an animal health component to reorganize OPV, eventually clear an additional 12,000 km2 of the tsetse fly, and introduce a special health program for small stock; and (d) a credit component for (ij private veterinary drug importers and distributors, and veterinary clinics; (ii) livestock and land development, and women activities in the PLMAs; (iii) semi-intensive poultry producers; and (iv) feed and livestock processing industries. Proiect Areas The policy reforms would be national in scope, while most of the services would focus on the Northwest, Adamaoua and Extreme North Provinces where livestock is concentrated. Producer organizations would also be initiated in the North, West and East Provinces. The pilot areas would be established in these six provinces. Further services for small stock and poultry would be provided in the Center, South and Littoral Provinces. The tsetse control component would be limited to the Adamaoua Province.  v Estimated Project Costs aJ X&ocal Foreisn Total -(USS million)----- Institution Building 7.7 13.4 21.1 Resource Managemant 1.9 5.0 6.9 Animal Health 1.8 8.7 10.5 Credit 1.1 6.6 7.7 Base Cost 12.5 33.7 46.2 Physical Contingencies 1.1 1.5 2.6 Price Contingencies 3.3 3.1 6.4 Total Project Costs 16.9 38.3 55.2 al Includes US$4.7 million of taxes and duties and US$300,000 for a PPF. Financing Plan Local Foreign Total ---(US$ million)_---- IBRD 7.5 27.1 34.6 IFAD 3.2 7.6 10.8 Government 6.1 1 0.2 6.3 EDF - 1.9 1.9 FAC 1.6 1.6 Total 16.8 38.4 55.2 Estimated IBRD Disbursements IBRD Fiscal Year 89 90 91 92 93 94 95 ------------(US$ million) -----------